First up, Sun Microsystems co-founder and CEO Scott McNealy as quoted in a Bloomberg interview, March 31, 2002:
"At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don’t need any transparency. You don’t need any footnotes. What were you thinking?"
And the rest of the story at Capitalist Exploits, February 11:
....THE EVERYTHING SHORTAGE
While on the topic of shortages, the following quote from Goldman Sachs’ head of commodities, Jeff Curie caught our eye:
Jeff Currie, the closely-followed head of commodities research at Goldman Sachs Group Inc., says he’s never seen commodity markets pricing in the shortages they are right now.
“I’ve been doing this for 30 years and I’ve never seen markets like this,” Currie said in a Bloomberg TV interview. “This is a molecule crisis. We’re out of everything, I don’t care if it’s oil, gas, coal, copper, aluminum, you name it we’re out of it.”
If you’re a long-term reader, this will be nothing new. The prolonged supply destruction in pretty much every commodity out there is starting to rear its ugly head. As a result, the magnitude of the bull market currently underway in commodities will surprise even the biggest bulls.
To remind you of just how extreme the disconnect between market sectors is, here is the commodities to S&P 500 ratio. Never in history have we seen such extremes.
....MUCH MORE
Sun survived the crash-and-burn of the dot.coms but was so wounded by the Nasdaq's 30-month decline, to the Naz's September 24, 2002 intra-day low of 1,169.04, down 77% from the 5048.62 March 10, 2000 closing high (execs and key employees left when their options went so deep underwater they could never recover, there was no money for R&D, etc.) that when the Great Financial Crisis hit in 2008 it could barely hang on and the company ended up being bought out by Oracle in 2010.
